Company Car: What Happens When It is Involved in a Crash?

car crash

In an office, it is the employer who usually provides the equipment and tools needed for employees to perform their tasks well. So, for those who work outside of the office, it would only be natural that employers provide employees with company cars.

Driving a company car is a benefit that a lot of adults want. It decreases expenses for individual employees and it also saves them from having to use the public transportation system, ensuring that they can come into the office or site on time.

Access to company cars can lead to better mobility and offer value to employees. It can motivate them to work harder, boost their productivity, reduce absences, and influence them to stay within the company.

Who is at Fault?

However, there are disadvantages to it. While there are advantages to offering company cars, especially to the employees, there are a few downsides for the employer.

What if the company car driven by an employee gets involved in an accident, for example?

The employer has no control over the company car once it is driven away by an employee. And, despite the precautions that the employee is taking, there is no way to completely avoid accidents.

In California and across the United States, it is not the driver who is at fault in a crash. The owner of the vehicle will be responsible for the incident. It is called the respondeat superior or, in simpler terms, vicarious liability in which the employers are liable for the negligent actions or non-actions of the employee. So, for example, if the employee was on the way to meet a client using the company vehicle and failed to stop at a stoplight, crashing at the back of the vehicle in front, the employer will have to answer for it. It is because, during office hours, the employee is acting within the scope of duties.

Employers that provide company vehicles should have an experienced car accident lawyer on standby to deal with incidents and protect the employer from litigation.

However, the employer is only liable if the incident happened while the employee was doing work-related tasks. The trip should have received the authorization of the company.

Insurance is also a factor. In most cases, the insurance policy that the employer carries extends to employees. Sometimes, it does not. Employees who have been given permission to drive the company car need to clarify the insurance terms with their employers.

Filter Who Get to Use the Company Car

company car

Around 70 percent of all organizations have company cars, but only 8.2 percent allow their employees to drive them. As mentioned, there are risks that come with allowing employees to use company cars.

It is possible to minimize the risk of accidents, and one of them is to check employee background. It does not matter if they are trusted by the company, or they are doing a great job. How they behave on the road might be different.

The employer should, for example, require that all employees who want access to the company car have a clean driving record for a certain number of years. There should not be a history of drunk or distracted driving in the past decade or so. People who have been apprehended by the authorities for driving-related offenses are automatically out.

Set a Guideline

The company should also create a set of rules beforehand to prevent employees from making a mistake while using the company car. For example, employees are not allowed to smoke and eat inside the company car, or they are prohibited from leasing the vehicle to someone else, especially not employed by the company.

In addition, make it clear that those who break the rules can get punished for it. Those who lend the company car to another person without the authorization of the company will no longer be allowed to drive the vehicle. These rules will force the employees to take better care of the company car.

Log Every Trip

It is also important for companies to monitor who drove the vehicle, when the vehicle was used, and where it went. Doing so will allow employers to ensure that the company car is being used as intended and by the right people. It will also discourage employees from breaking the rules.

Using a company car for work is a privilege that a lot of employees want. While it gives numerous advantages, there are also disadvantages. It is important that employers make sure that the employees are safe while on the road and following the rules while using the company cars.

Share on facebook
Share on google
Share on twitter
Share on linkedin
Scroll to Top